U.S. Customs and Border Protection (CBP) has announced key updates to its tariff refund process that will significantly affect importers, customs brokers, and logistics professionals — particularly as they await major legal rulings that could trigger an unprecedented wave of reimbursement claims for duties paid under controversial tariff policies.
These changes center on modernization of refund systems and clarity around how importers can claim back overpaid duties.
Shift to Full Electronic Refunds in 2026
One of the most consequential updates is the transition from paper refund checks to 100% electronic refunds beginning Feb. 6, 2026. An interim final rule published in the Federal Register requires CBP to issue all refund payments — including tariff and duty refunds, drawback claims, and other customs reimbursements — via Automated Clearing House (ACH) transfers, with extremely limited exceptions for hardship waivers under federal regulation.
CBP has also improved its Automated Commercial Environment (ACE) portal with new tools to support this transition, such as online authorization for electronic refunds and streamlined account setup for importers and brokers. These enhancements are designed to speed up processing, reduce errors, and improve security while phasing out slower, costlier paper check methods.
Tariff Refund Eligibility and Legal Context
The refund process itself — separate from the electronic delivery method — remains highly context‑dependent and can be complex. Importers typically pursue tariff or duty refunds through Post Summary Corrections (PSCs) filed during the unliquidated period (usually within about 300 days of customs entry) or through protests filed within 180 days after liquidation.
These administrative remedies are standard ways to recover overpaid duties due to misclassification, missed exclusions, or overlapping tariff errors.
Beyond routine tariff corrections, many U.S. companies are actively watching pending litigation over the legality of certain tariffs imposed under the International Emergency Economic Powers Act (IEEPA). If the U.S. Supreme Court ultimately invalidates those tariffs, importers could be eligible to recover massive amounts — potentially tens to hundreds of billions of dollars — though the process and timing would likely be complex and drawn out.
Recent reporting shows companies have already begun protective litigation and strategic filings to preserve refund rights.
Refunds for Tariff “Stacking” and Overpayments
CBP has additionally issued guidance on tariff “stacking” refunds stemming from an executive order that limited cumulative application of overlapping duties.
Under this framework, importers whose past entries were burdened by multiple overlapping tariffs — for example, a combination of Section 232 steel tariffs with emergency levies — may now seek refunds by filing PSCs for unliquidated entries or protests for liquidated entries still within legal deadlines.
Similarly, earlier implementation of tariff refund mechanisms — such as those addressing tariff stacking overpayments under executive policy — suggests the broader tariff refund landscape includes multiple layers of eligibility beyond standard tariff disputes.
What Importers Should Do Now
With the refund issuance method modernized and the legal backdrop evolving, importers are advised to:
- Enroll in ACH refunds via the ACE portal ahead of the February deadline to ensure timely receipt of any future refunds.
- Review past tariff entries for potential overcharges, stacking issues, or eligibility for PSC or protest filings.
- Track liquidation timelines closely, as missing administrative filing deadlines can permanently foreclose refund claims.
- Stay apprised of the Supreme Court decision and related litigation, as any ruling against IEEPA tariffs could significantly expand refund opportunities.
A Modernized Process for a Complex Trade Environment
CBP’s moves toward electronic refunds and clearer refund procedures reflect a broader effort to modernize trade operations and support U.S. supply chain resilience in a period marked by tariff disputes and shifting policy.
For importers navigating a potentially historic refund phase, being proactive about compliance, digital readiness, and legal strategy will be vital to capturing value and managing cash flow in 2026 and beyond.
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Staff Report
Ashton York
